ESMA Opinion
ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps:
On the adverse events or developmentsESMA considers that there are adverse developments which constitute a serious threat to financial stability and to market confidence in Spain.
On the appropriateness and proportionality of the measure ESMA considers that the measure is appropriate and proportionate to address the above-mentioned threats that persist in Spain.
On the duration of the measureESMA considers that the duration of the measure is justified and appreciates the CNMV’s statement in its notification of intent whereby the measure may be lifted during the period of enforcement of the measure, if considered necessary.

ESMA Opinion
ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps:
On the adverse events or developmentsESMA considers that there are adverse developments which constitute a serious threat to financial stability and to market confidence in Greece.
On the appropriateness and proportionality of the measure ESMA considers that the measure is appropriate and proportionate to address the above-mentioned threats that persist in Greece.
On the duration of the measureESMA considers that the duration of the measure is justified and appreciates the HCMC’s statement in its notification of intent whereby the measure may be lifted during the period of enforcement of the measure, if considered necessary.

Legal basis
1. Regulation (EU) No 1095/2010 (ESMA Regulation) sets out the European Securities and Markets Authority’s (ESMA) scope of action, tasks and powers which include “enhancing customer protection”, and “foster[ing] investor protection”.
2. In order to continue delivering on this investor protection statutory objective, ESMA is issuing this opinion on certain aspects linked to the manufacturing and distribution of structured retail products (SRP). This opinion takes into account relevant work done in this field both at European and interna-tional level.
3. This opinion is without prejudice to the requirements for the provision of investment services and activities established in the Markets in Financial Instruments Directive (MiFID) and its implementing measures (notably, Directive 2006/73/EC), the regulatory developments arising from the MiFID review or existing product rules that may apply to SRPs.
4. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of the ESMA Regulation. In accordance with Article 44(1) of the ESMA Regulation, the Board of Supervisors has adopted this opinion.
Background
5. In its July 2013 report on ‘Retailisation in the EU’ , ESMA highlighted that, from a consumer protec-tion perspective, retail investors may face difficulties in understanding the drivers of risks and returns of structured products. If retail investors do not properly understand the risk and reward profile of structured products, and if the products are not properly assessed against the risk appetite of retail investors, retail investors might be exposed to unexpected losses and this might lead to complaints, reputational risks for manufacturers and distributors, and a loss of confidence in the regulatory framework and, more broadly, in financial markets.
6. In 2013, ESMA mapped the measures adopted in the EU Member States in relation to complex products in order to identify issues and to better understand the rationale behind national initiatives (by looking at similarities and differences in the various approaches, and reviewing how complexity has been treated in the different EU Members States).
7. As a result, ESMA has developed a broad set of non-exhaustive examples of good practices, attached as Annex 1 hereto, illustrating arrangements that firms - taking into account the nature, scale and complexity of their business - could put in place to improve their ability to deliver on investor protection regarding, in particular, (i) the complexity of the SRPs they manufacture or distribute, (ii) the nature and range of the investment services and activities undertaken in the course of that business, and (iii) the type of investors they target. These good practices should also be a helpful tool for competent authorities in carrying out their supervisory action.
Opinion
8. ESMA considers that sound product governance arrangements are fundamental for investor protec-tion purposes, and can reduce the need for product intervention actions by competent authorities.
9. ESMA considers that, when supervising firms manufacturing or distributing an SRP, competent authorities should promote, in their supervisory approaches, the examples of good practices for firms set out in Annex 1 hereto.
10. Although the good practices set out in Annex 1 hereto focus on structured products sold to retail investors, ESMA considers that they may also be a relevant reference for other types of financial in-struments (such as asset-backed securities, or contingent convertible bonds), as well as when financial instruments are being sold to professional clients.
11. The exposure to risk is an intrinsic feature of investment products. The good practices set out in Annex 1 refer to product governance arrangements and do not (and cannot) aim at removing investment risk from products.

OPINION
Renewal of emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation No 236/2012 on short selling and certain aspects of credit default swaps
I. Legal basis
1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances.
2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion.
II. Background
3. In accordance with Article 26 of the Regulation, the Hellenic Capital Market Commission (HCMC) originally notified ESMA and competent authorities on the 29th of June 2015 of its intention to make use of its powers of intervention in exceptional circumstances and to introduce an emergency measure under Article 20 of the Regulation.
4. The original emergency measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC.
5. The original measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with Regulation (EU) N0 236/2012 and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market maker activities.
6. In the original notification, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely:
• closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included);
• closure of The Electronic Secondary Market “HDAT” for government bonds operated for the same period;
• suspension of redemption of mutual funds’ units;
• suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”;
• suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository;
• trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States).
7. The reason for proposing a temporary prohibition for the creation, or increase, of net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of the investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within Greece, the measure would have not created disproportionate negative effects, since it would have affected a fairly small part of the EU overall market.
8. Following the issuance by ESMA of a positive opinion pursuant to Article 27 of the Regulation on the 29th of June, the original measure by the HCMC entered into force at 00:00:01 hours (CET) on 30th June 2015, and applied for a period of seven days, ending at 24:00:00 (CET) on 6th July 2015.
9. On the 6th of July 2015, the measures described in paragraph 6 were renewed by the Greek authorities and the bank holiday in Greece was also extended. On the same day, the HCMC proposed a renewal of the short selling measure, notifying ESMA and competent authorities accordingly.
10. In the notification for the renewal, the HCMC explains that it believes the circumstances that justified the imposition of the original measure did not improve during the last week and therefore the measure should be renewed. Moreover, all the other measures adopted by the Greek authorities were renewed or extended, and the short selling measure remains a relevant component to ensure the effectiveness of the other ones.
11. The proposed renewal would concern the same financial instruments of the original measure (see paragraph 5), but the HCMC specified in the new notification that although the ban covers all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs are included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” of which the relevant Competent Authority is the HCMC represent more than 5% of the total value (or composition) of these instruments.
12. The renewed measure shall apply for a period of seven days and shall be in force as of 00:00:01 hours (CET) on 7th July 2015 until 24:00:00 (CET) on 13th of July 2015.
III. Opinion
13. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps:
On the adverse events or developments
ESMA considers that adverse developments which constitute a serious threat to market confidence in the Greek market still persist.
On the appropriateness and proportionality of the measure
ESMA considers that the measure is appropriate and proportionate to address the above mentioned threats that persist in the Hellenic Republic.
On the duration of the measure
ESMA considers that the duration of the measure is justified and appreciates HCMC’s statement in its notification of intent that the measure may be lifted before the end of the established period or renewed in accordance with the provisions of the Regulation (EU) No 236/2012 if circumstances that justified the imposition of the measure improve, persist or worsen.

OPINION
Renewal of emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation No 236/2012 on short selling and certain aspects of credit default swaps
I. Legal basis
1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances.
2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion.
II. Background
3. On the 29th of June 2015, ESMA issued an opinion on the emergency measure introduced by the Hellenic Capital Market Commission (HCMC) under Article 20 of the Regulation. The measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC and was applied from 30th June 2015 at 00.00.01 CET to the 6th July 2015 at 24:00:00 (CET).
4. The measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with Regulation (EU) N0 236/2012 and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market maker activities.
5. In the original notification to ESMA, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely:
• closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included);
• closure of The Electronic Secondary Market “HDAT” for government bonds operated for the same period;
• suspension of redemption of mutual funds’ units;
• suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”;
• suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository;
• trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States).
6. The reason for proposing a temporary prohibition for the creation, or increase, of net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of the investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within Greece, the measure would have not created disproportionate negative effects, since it would have affected a fairly small part of the EU overall market.
7. On the 6th of July 2015, the measures described in paragraph 5 were renewed by the Greek authorities and the bank holiday in Greece was also extended. On the same day, the HCMC notified ESMA and competent authorities of its intention to renew the short selling measure and ESMA issued a positive opinion concerning this first renewal pursuant to Article 27 of the Regulation.
8. The first renewal concerned the same financial instruments of the original measure (see paragraph 5), but the HCMC specified in the related notification that although the ban covers all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs are included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” of which the relevant Competent Authority is the HCMC represent more than 5% of the total value (or composition) of these instruments.
9. This renewal entered into force at 00:00:01 hours (CET) on 7th July 2015 and will expire at 24:00:00 (CET) on 13th July 2015.
10. On the 13th of July 2015, the measures described in paragraph 5 were renewed again by the Greek authorities and the bank holiday in Greece was also extended. On the same day, in accordance with Article 26 of the Regulation, the HCMC has notified ESMA and other competent authorities of its intention to make use of its powers of intervention in exceptional circumstances and to renew again the current emergency measure under Article 20 of the Regulation.
11. In the notification for this second renewal, the HCMC explains that it believes the circumstances that justified the imposition of the original measure and of the first renewal did not improve yet and therefore the measure should be extended again. Moreover, all the other measures adopted by the Greek authorities were extended, and the short selling measure remains a relevant component to ensure the effectiveness of the other ones.
12. The proposed second renewal would concern exactly the same instruments as of the first renewal.
13. The renewed measure shall apply for a period of seven days and shall be in force as of 00:00:01 hours (CET) on 14th July 2015 until 24:00:00 (CET) on 20th of July 2015.
III. Opinion
14. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps:
On the adverse events or developments
ESMA considers that adverse developments which constitute a serious threat to market confidence in the Greek market still persist.
On the appropriateness and proportionality of the measure
ESMA considers that the measure is appropriate and proportionate to address the above mentioned threats that persist in the Hellenic Republic.
On the duration of the measure
ESMA considers that the duration of the measure is justified and appreciates HCMC’s statement in its notification of intent that the measure may be lifted before the end of the established period or renewed in accordance with the provisions of the Regulation (EU) No 236/2012 if circumstances that justified the imposition of the measure improve, persist or worsen.

OPINION
Renewal of emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation No 236/2012 on short selling and certain aspects of credit default swaps
I. Legal basis
1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances.
2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion.
II. Background
3. On the 29th of June 2015, ESMA issued an opinion on the emergency measure introduced by the Hellenic Capital Market Commission (HCMC) under Article 20 of the Regulation. The measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC and was applied from 30th June 2015 at 00.00.01 CET to the 6th July 2015 at 24:00:00 (CET).
4. The measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with Regulation (EU) N0 236/2012 and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market maker activities.
5. In the original notification to ESMA, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely:
• closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included);
• closure of The Electronic Secondary Market “HDAT” for government bonds operated for the same period;
• suspension of redemption of mutual funds’ units;
• suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”;
• suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository; and
• trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States).
6. The reason for proposing a temporary prohibition for the creation, or increase, of net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of the investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within the Hellenic Republic, the measure would have not created disproportionate negative effects, since it would have affected a fairly small part of the EU overall market.
7. On the 6th and 13th of July 2015, the measures described in paragraph 5 were renewed by the Greek authorities and the bank holiday in the Hellenic Republic was also extended. On the same days, the HCMC notified ESMA and competent authorities of its intention to renew the short selling measure and ESMA issued in both cases a positive opinion concerning these renewals pursuant to Article 27 of the Regulation.
8. The renewals concerned the same financial instruments of the original measure (see paragraph 5), but the HCMC specified in the related notification that although the ban covers all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs are included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” of which the relevant Competent Authority is the HCMC represent more than 5% of the total value (or composition) of these instruments.
9. The renewal notified on the 13th July entered into force at 00:00:01 hours (CET) on 14th July 2015 and will expire at 24:00:00 (CET) on 20th July 2015.
10. On the 20th of July 2015, the measures described in paragraph 5 were renewed again by the Greek authorities. On the same day, in accordance with Article 26 of the Regulation, the HCMC has notified ESMA and other competent authorities of its intention to make use of its powers of intervention in exceptional circumstances and to renew again the current emergency measure under Article 20 of the Regulation.
11. In the notification for this third renewal, the HCMC explains that it believes the circumstances that justified the imposition of the original measure and of the previous renewals did not improve yet and therefore the measure should be extended again. Moreover, all the other measures adopted by the Greek authorities were extended, and the short selling measure remains a relevant component to ensure the effectiveness of the other ones.
12. The proposed third renewal would concern exactly the same instruments as of the previous renewals. In the latest notification to ESMA and competent authorities, the HCMC revised its wording to the benefit of legal certainty regarding the nature of the emergency measure and the scope of the financial instruments concerned. In particular, the HCMC latest notification refers to short sales of shares under Article 20(2)(a) and any transaction referred to in Article 20(2)(b) of the Regulation (EU) N0 236/2012. The notification also lists explicitly all the categories of financial instruments relating to the concerned shares to which the measure will apply, rather than identifying these related instruments by cross referring to the Annex of Commission Regulation No 918/2012. Thus, the following financial instruments under MiFID are included: options, covered warrants, futures, index-related instruments, contracts for difference, shares/units of exchange-traded funds, swaps, spread bets, packaged retail or professional investment products, complex derivatives, certificates linked to shares, and global depositary receipts.
13. The renewed measure shall apply for a period of seven days and shall be in force as of 00:00:01 hours (CET) on 21st July 2015 until 24:00:00 (CET) on 27Th of July 2015.
III. Opinion
14. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps:
On the adverse events or developments
ESMA considers that adverse developments which constitute a serious threat to market confidence in the Greek market still persist. Comparing the current situation in the Hellenic Republic with related events over the past few years, the threat to financial stability and investor protection at least in the Hellenic Republic is obvious. Despite the partial reopening of credit institutions on 20 July 2015, the situation of fragility in the financial system and in the broader Greek economy persists. The relation between this situation and the financial markets is clear, as evidenced by the closure of Greek financial markets.
On the appropriateness and proportionality of the measure
ESMA considers that the measure is appropriate and proportionate to address the above mentioned threats that persist in the Hellenic Republic. Allowing short positions to be built at this stage could exacerbate the threats to financial stability, especially as regards the financial sector. Besides, the inclusion of short positions built through related instruments is appropriate and proportionate since tolerating the build-up of over-the-counter (OTC) short positions and short positions through related instruments would put retail investors at a disadvantage compared to professional investors (who can access OTC wholesale markets more easily), given the main markets are still closed for trading, and would ultimately undermine the overall efficiency of the measure.
On the duration of the measure
ESMA considers that the duration of the measure is justified. It is a relatively short renewal period that indicates that the measure is linked with specific events and allows its reconsideration at short intervals, which ensures that the assessment of the risks is also performed frequently. Besides, ESMA appreciates HCMC’s statement in its notification of intent that the measure may be lifted before the end of the established period or renewed in accordance with the provisions of Regulation (EU) No 236/2012 if circumstances that justified the imposition of the measure improve, persist or worsen.

OPINION
Renewal of emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation No 236/2012 on short selling and certain aspects of credit default swaps
I. Legal basis
1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances.
2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion.
II. Background
3. On the 29th of June 2015, ESMA issued an opinion on the emergency measure introduced by the Hellenic Capital Market Commission (HCMC) under Article 20 of the Regulation. The measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC and was applied from 30th June 2015 at 00.00.01 CET to the 6th July 2015 at 24:00:00 (CET).
4. The measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with Regulation (EU) N0 236/2012 and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market maker activities.
5. In the original notification to ESMA, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely:
• closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included);
• closure of The Electronic Secondary Market “HDAT” for government bonds operated for the same period;
• suspension of redemption of mutual funds’ units;
• suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”;
• suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository;
• trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States).
6. The reason for proposing a temporary prohibition for the creation, or increase, of net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of the investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within the Hellenic Republic, the measure would have not created disproportionate negative effects, since it would have affected a fairly small part of the EU overall market.
7. On the 6th, the 13th and the 20th of July 2015, the measures described in paragraph 5 were renewed by the Greek authorities. On the same days, the HCMC notified ESMA and competent authorities of its intention to renew the short selling measure and ESMA issued in all cases a positive opinion concerning these renewals pursuant to Article 27 of the Regulation.
8. The renewals concerned the same financial instruments of the original measure (see paragraph 5), but the HCMC specified in the related notification that although the ban covers all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs are included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” of which the relevant Competent Authority is the HCMC represent more than 5% of the total value (or composition) of these instruments.
9. The renewal notified on the 20th of July entered into force at 00:00:01 hours (CET) on the 21th of July 2015 and will expire at 24:00:00 (CET) on the 27th of July 2015.
10. On the 27th of July 2015, while the measures described in paragraph 5 were still in force. in accordance with Article 26 of the Regulation, the HCMC has notified ESMA and other competent authorities of its intention to make use of its powers of intervention in exceptional circumstances and to renew again the current emergency measure under Article 20 of the Regulation.
11. In the notification for this fourth renewal, the HCMC explains that it believes the circumstances that justified the imposition of the original measure and of the previous renewals did not improve yet and therefore the measure should be extended again. Moreover, being the other measures adopted by the Greek authorities still in force, the short selling measure remains a relevant component to ensure their effectiveness.
12. The proposed fourth renewal would concern exactly the same instruments as of the previous renewals. The latest notification featured the same wording used in the 20th of July 2015 notification to ESMA and competent authorities, where the HCMC revised its previous wording to the benefit of legal certainty regarding the nature of the emergency measure and the scope of the financial instruments concerned. In particular, the HCMC latest notification refers to short sales of shares under Article 20(2)(a) and any transaction referred to in Article 20(2)(b) of the Regulation (EU) No 236/2012. The notification also lists explicitly all the categories of financial instruments relating to the concerned shares to which the measure will apply, rather than identifying these related instruments by cross referring to the Annex of Commission Regulation No 918/2012. Thus, the following financial instruments under MiFID are included: options, covered warrants, futures, index-related instruments, contracts for difference, shares/units of exchange-traded funds, swaps, spread bets, packaged retail or professional investment products, complex derivatives, certificates linked to shares, and global depositary receipts.
13. The renewed measure shall apply for a period of seven days and shall be in force as of 00:00:01 hours (CET) on the 28th of July 2015 until 24:00:00 (CET) on the 3rd of August 2015.
III. Opinion
14. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps:
On the adverse events or developments
ESMA considers that adverse developments which constitute a serious threat to market confidence in the Greek market still persist. Comparing the current situation in the Hellenic Republic with related events over the past few years, the threat to financial stability and investor protection at least in the Hellenic Republic is obvious. Despite the partial reopening of credit institutions on 20 July 2015, the situation of fragility in the financial system and in the broader Greek economy persists. The relation between this situation and the financial markets is clear, as evidenced by the continued closure of Greek financial markets.
On the appropriateness and proportionality of the measure
ESMA considers that the measure is appropriate and proportionate to address the above mentioned threats that persist in the Hellenic Republic. Allowing short positions to be built at this stage could exacerbate the threats to financial stability, especially as regards the financial sector. Besides, the inclusion of short positions built through related instruments is appropriate and proportionate since tolerating the build-up of over-the-counter (OTC) short positions and short positions through related instruments would put retail investors at a disadvantage compared to professional investors (who can access OTC wholesale markets more easily), given that the main markets are still closed for trading, and would ultimately undermine the overall efficiency of the measure.
On the duration of the measure
ESMA considers that the duration of the measure is justified. It is a relatively short renewal period that indicates that the measure is linked with specific events and allows its reconsideration at short intervals, which ensures that the assessment of the risks is also performed frequently. Besides, ESMA appreciates HCMC’s statement in its notification of intent that the measure may be lifted before the end of the established period or renewed in accordance with the provisions of Regulation (EU) No 236/2012 if circumstances that justified the imposition of the measure improve, persist or worsen.

OPINION
Renewal of emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation No 236/2012 on short selling and certain aspects of credit default swaps
I. Legal basis
1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances.
2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion.
II. Background
3. On the 29th of June 2015, ESMA issued an opinion on the emergency measure introduced by the Hellenic Capital Market Commission (HCMC) under Article 20 of the Regulation. The measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC and was applied from 30th June 2015 at 00.00.01 CET to the 6th July 2015 at 24:00:00 (CET).
4. The measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with Regulation (EU) N0 236/2012 and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market maker activities.
5. In the original notification to ESMA, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely:
• closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included);
• closure of the Electronic Secondary Market “HDAT” for government bonds operated for the same period;
• suspension of redemption of mutual funds’ units;
• suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”;
• suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository;
• trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States).
6. The reason for proposing a temporary prohibition for the creation, or increase, of net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of the investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within the Hellenic Republic, the measure would have not created disproportionate negative effects, since it would have affected a fairly small part of the EU overall market.
7. On the 6th, the 13th, the 20th and the 27th of July 2015, the measures described in paragraph 5 were renewed by the Greek authorities. On the same days, the HCMC notified ESMA and competent authorities of its intention to renew the short selling measure and ESMA issued in all cases a positive opinion concerning these renewals pursuant to Article 27 of the Regulation.
8. The renewals concerned the same financial instruments of the original measure (see paragraph 5), but the HCMC specified in the related notifications that although the ban covers all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs are included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” of which the relevant Competent Authority is the HCMC represent more than 5% of the total value (or composition) of these instruments.
9. The renewal notified on the 27th of July entered into force at 00:00:01 hours (CET) on the 28th of July 2015 and will expire at 24:00:00 (CET) on the 3rd of August 2015.
10. On the 3rd of August 2015, following and due to the Decision of the Greek Minister of Finance “Lifting of the restrictions of the Act of Legislative Content of 18.07.2015 (A’84) regarding transactions in financial instruments on Greek regulated markets”, the HCMC decided to reopen the ATHEX regulated market, the Multilateral Trading Facility of “EN.A”, the Electronic Secondary Market “HDAT” for government bonds, and to restart the operations of settlement of securities traded in Greek regulated markets, by the Hellenic Central Securities Depository.
11. On the same day, in accordance with Article 26 of the Regulation, the HCMC has notified ESMA and other competent authorities of its intention to make use of its powers of intervention in exceptional circumstances and to renew again the current emergency measure under Article 20 of the Regulation.
12. In the notification for this fifth renewal, the HCMC explains that since the Athens Exchange and the MTF “EN.A” have reopened after a period of more than one month, domestic capital market activity and securities’ prices are expected to be volatile. In particular, given that the markets will reopen after such an unprecedented closure and time may be necessary until their complete normalisation, additional pressure on stock valuations due to net short positions would pose a significant risk of deterioration of market conditions.
13. The proposed fifth renewal would concern exactly the same instruments as of the previous renewals. The latest notification featured the same wording used in the 20th of July 2015 notification to ESMA and competent authorities, where the HCMC revised its previous wording to the benefit of legal certainty regarding the nature of the emergency measure and the scope of the financial instruments concerned. In particular, the HCMC latest notification refers to short sales of shares under Article 20(2)(a) and any transaction referred to in Article 20(2)(b) of the Regulation (EU) No 236/2012. The notification also lists explicitly all the categories of financial instruments relating to the concerned shares to which the measure will apply, rather than identifying these related instruments by cross referring to the Annex of Commission Regulation No 918/2012. Thus, the following financial instruments under MiFID are included: options, covered warrants, futures, index-related instruments, contracts for difference, shares/units of exchange-traded funds, swaps, spread bets, packaged retail or professional investment products, complex derivatives, certificates linked to shares, and global depositary receipts.
14. The proposed fifth renewal of the short selling measure would apply to any natural or legal person, irrespective of their country of residence, but would be subject to the exemption for market making activities, provided that short positions have been entered into for hedging purposes. The exemption for market makers is a new element of this latest renewal of the short position ban, and it is justified by the fact that the Greek financial markets are now open and market making activities are important providers of liquidity for the Greek shares, as well as for warrants, derivatives, index derivatives and ETF related to Greek shares.
15. The renewed measure shall apply for a period of twenty-eight days and shall be in force as of 00:00:01 hours (CET) on the 4th of August 2015 until 24:00:00 (CET) on the 31st of August 2015. The proposed renewal is longer than the previous ones, which all were of seven days each. The HCMC justified such a longer renewal explaining that upon reopening of Greek financial markets, considerable pressure is anticipated: capital controls are still in force and the return to normality will probably require a longer period of time. As a result, HCMC considers the short selling measure as an important element for the transitional period.
III. Opinion
16. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps:
On the adverse events or developments
ESMA considers that adverse developments which constitute a serious threat to market confidence in the Greek market still persist. Comparing the current situation in the Hellenic Republic with related events over the past few years, the threat to financial stability and investor protection at least in the Hellenic Republic is obvious. Despite the partial reopening of credit institutions on 20 July 2015, and the reopening on 3 August 2015 of the ATHEX regulated market, the Multilateral Trading Facility of “EN.A”, and of the Electronic Secondary Market “HDAT” for government bonds, the situation of fragility in the financial system and in the Greek economy persists, as highlighted by the extreme volatility already experienced on the ATHEX in the course of the first hours of reopening.
On the appropriateness and proportionality of the measure
ESMA considers that the measure is appropriate and proportionate to address the above mentioned threats that persist in the Greek financial markets. Allowing short positions to be built at this stage could exacerbate the threats to financial stability, especially as regards the financial sector. The new exemption foreseen for market making activities is justified by the fact that Greek financial markets are now open, and therefore market makers should be allowed to properly carry out their activity, thus enhancing the liquidity on the Greek shares and related instruments, and contributing to the normalisation of the activities on the Greek financial markets.
On the duration of the measure
ESMA considers that the duration of the measure is justified. In the previous extensions, measures were always proposed for a seven day period each, considering that the moment in which the Greek financial markets would have reopened was not known at that time. This is no longer the case, since Greek financial markets have reopened after more than one month. An unusual degree of volatility on the Greek financial markets is therefore anticipated in the short term. Such expectation is exacerbated considering that the month of August is generally characterised by lower volumes of transactions.
Under these circumstances, ESMA considers it is necessary and appropriate for HCMC to impose a net short position ban that would last until the end of the month, in view of supporting the proper functioning of the Greek financial markets in this transitional period. Besides, ESMA takes into consideration HCMC’s statement in its notification of intent that the measure may be lifted before the end of the established period or renewed in accordance with the provisions of Regulation (EU) No 236/2012 if circumstances that justified the imposition of the measure improve, persist or worsen.

OPINION Emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation No 236/2012 on short selling and certain aspects of credit default swaps I. Legal basis 1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances. 2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion. II. Background 3. On the 29th of June 2015, ESMA issued an opinion on the emergency measure introduced by the Hellenic Capital Market Commission (HCMC) under Article 20 of the Regulation. The measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC and was applied from 30th June 2015 at 00.00.01 CET to the 6th July 2015 at 24:00:00 (CET). 4. The measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with Regulation (EU) N0 236/2012 and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market maker activities. 5. In the original notification to ESMA, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely: • closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included); • closure of the Electronic Secondary Market “HDAT” for government bonds operated for the same period; • suspension of redemption of mutual funds’ units; • suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”; • suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository; • trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States). 6. The reason for proposing a temporary prohibition for the creation, or increase, of a net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within the Hellenic Republic, the measure would have not created disproportionate negative effects, since it would have affected a fairly small part of the EU overall market. 7. On the 6th, the 13th, the 20th and the 27th of July and on the 3rd of August 2015, some of the measures described were renewed by the Greek authorities. On the same days, the HCMC notified ESMA and competent authorities of its intention to renew the short selling measure and ESMA issued in all cases a positive opinion concerning these renewals pursuant to Article 27 of the Regulation. 8. The renewals concerned the same financial instruments of the original measure (see paragraph 4), but the HCMC specified in the related notifications that although the ban covers all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs are included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” of which the relevant Competent Authority is the HCMC represent more than 5% of the total value (or composition) of these instruments. 9. The renewal notified on the 3rd of August entered into force at 00:00:01 hours (CET) on the 4th of August 2015 and expires at 24:00:00 (CET) on the 31st of August 2015. 10. On the 31st of August 2015, in accordance with Article 26 of the Regulation, the HCMC has notified ESMA and other competent authorities of its intention to make use of its powers of intervention in exceptional circumstances and to introduce an emergency measure under Article 20 of the Regulation which is however of a different nature than the one previously introduced and renewed five times which is expiring on the 31st of August. 11. The proposed measure consists in a ban on short selling of shares and units of Exchange Traded Funds (ETFs) admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is the HCMC. It will also concern all depository receipts (ADRs, GDRs) representing shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange). This ban would include sales which are covered with subsequent intraday purchases. 12. The proposed short selling measure would apply to any natural or legal person, irrespective of their country of residence, but would be subject to the exemption for market making activities, provided that short selling transactions are conducted for hedging purposes. 13. The measure shall apply for a period of thirty calendar days and shall be in force until 24:00:00 (CET) on the 30th of September 2015. 14. In the notification, the HCMC explains that despite the reopening of the Athens Exchange and the MTF “EN.A” on the 3rd of August after a period of more than one month, there are still conditions on the Greek capital market which prevent its smooth functioning: • the imposition of capital controls and the restrictions of transfers in the acquisition of financial instruments (i.e. restrictions on the buy side) for Greek investors based on Article 5 of Law. 3606/2007 (A 195) through regulated markets and multilateral trading facilities or professionals who have such financial instruments as UCITS; • the political developments namely the forthcoming parliamentary elections that will take place on the 20th of September 2015; • the forthcoming recapitalisation of the four Greek “systemic” credit institutions. 15. The reason for proposing a temporary ban on short selling is that the HCMC deemed it necessary for the protection of investors and the preservation of financial stability. In fact, such prohibition is considered by the HCMC a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on the instruments concerned by the measures normally is located within the Hellenic Republic, the measure would not create disproportionate negative effects, since it would have affected a fairly small part of the EU overall market. III. Opinion 16. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps: On the adverse events or developments ESMA considers that adverse developments which constitute a serious threat to market confidence in the Greek market still persist. Comparing the current situation in the Hellenic Republic with related events over the past few years, the threat to financial stability and investor protection at least in the Hellenic Republic is obvious. Despite the partial reopening of credit institutions on 20 July 2015, and the reopening on 3 August 2015 of the ATHEX regulated market, the Multilateral Trading Facility of “EN.A”, and of the Electronic Secondary Market “HDAT” for government bonds, the situation of fragility in the financial system and in the Greek economy persists, as highlighted by the high volatility already experienced on the ATHEX in the course of the first days after reopening. However, ESMA considers that the severity of the market events is lower than in previous weeks. On the appropriateness and proportionality of the measure ESMA considers that the measure means in practice a partial lifting of the previous ban on short position, both in terms of the instruments covered and of the general restriction to operate on Greek underlyings. Therefore, ESMA considers that the measure is appropriate and proportionate to address the above mentioned threats that persist in the Greek financial markets. Short sales in shares and units of ETFs could still exacerbate the threats to financial stability, especially as regards the financial sector. However the new measure, with a smaller scope, is not restricting the activities of the derivative markets. In that respect, ESMA understands that the measure accompanies the gradual normalization of financial conditions in Greece. The exemption foreseen for market making activities is justified by the fact that market makers should be allowed to properly carry out their activity, thus enhancing the liquidity on the Greek shares and ETFs units, and contributing to the adequate functioning of Greek financial markets. On the duration of the measure ESMA considers that the duration of the measure is justified, taking into account that the capital controls are still in place, the on-going recapitilisation process and the electoral calendar. Under these circumstances, ESMA considers it is necessary and appropriate for HCMC to impose a short selling ban on shares and ETFs units that would last until the end of September, in view of supporting the proper functioning of the Greek financial markets in this transitional period. Besides, ESMA takes into consideration HCMC’s statement in its notification of intent that the measure may be lifted before the end of the established period or renewed in accordance with the provisions of Regulation (EU) No 236/2012 if circumstances that justified the imposition of the measure improve, persist or worsen.

Emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation (EU) No 236/2012 on short selling and certain aspects of credit default swaps
I. Legal basis
1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances.
2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion.
II. Background
3. On the 29th of June 2015, ESMA issued an opinion on the emergency measure introduced by the Hellenic Capital Market Commission (HCMC) under Article 20 of the Regulation. The measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC and was applied from 30th June 2015 at 00.00.01 CET to the 6th July 2015 at 24:00:00 (CET).
4. The measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with the Regulation and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market making activities.
5. In the original notification to ESMA, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely:
• closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included);
• closure of the Electronic Secondary Market “HDAT” for government bonds operated for the same period;
• suspension of redemption of mutual funds’ units;
• suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”;
• suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository;
• trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States).
6. The reason for proposing a temporary prohibition for the creation, or increase, of a net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within the Hellenic Republic, the measure would not create disproportionate negative effects, since it would affect a fairly small part of the EU overall market.
7. On the 6th, the 13th, the 20th and the 27th of July and on the 3rd of August 2015, some of the measures described were renewed by the Greek authorities. On the same days, the HCMC notified ESMA and competent authorities of its intention to renew the short selling measure and ESMA issued in all cases a positive opinion concerning these renewals pursuant to Article 27 of the Regulation.
8. The renewals concerned the same financial instruments of the original measure (see paragraph 4), but the HCMC specified in the related notifications that although the ban covered all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs were included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, of which the relevant Competent Authority is the HCMC, represented more than 5% of the total value (or composition) of these instruments.
9. On the 31st of August 2015, in accordance with Article 26 of the Regulation, the HCMC introduced a new emergency measure under Article 20 of the Regulation consisting in a ban on short selling of shares and units of Exchange Traded Funds (ETFs) admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is the HCMC. It also concerned all depository receipts (ADRs, GDRs) representing shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange). The short selling measure applied to any natural or legal person, irrespective of their country of residence, but contained the exemption for market making activities, provided that short selling transactions are conducted for hedging purposes. The ban adopted on August 31st expires at 24:00:00 (CET) on the 30th of September 2015.
10. On the 30th of September 2015, in accordance with Article 26 of the Regulation, the HCMC notified ESMA and other competent authorities of its intention to make use of its powers of intervention in exceptional circumstances and introduced a new emergency measure under Article 20 of the Regulation.
11. The proposed measure consists in a ban on short selling of shares of five credit institutions admitted to trading on the Athens Exchange and comprising the FTSE/Athex Banks Index, irrespective of the venue where the transaction is executed. The temporary prohibition includes sales of shares covered by subsequent intraday purchases. The temporary prohibition of short selling applies to all depository receipts (ADRs, GDRs) and warrants representing shares of such credit institutions admitted to trading on the Athens Exchange and comprising the FTSE/Athex Banks Index.
12. The above mentioned credit institutions are:
- Alpha Bank A.E. (ISIN GRS015013006)
- Attica Bank S.A. (ISIN GRS001003003)
- National Bank of Greece S.A. (ISIN GRS003003019)
- Eurobank Ergasias S.A. (ISIN GRS323003004)
- Piraeus Bank S.A. (ISIN GRS014003008)
13. In the notification, the HCMC explains the reason for proposing this measure is that in July 2015 the Eurogroup agreed on a specific package of measures regarding the development of the Greek Economy, the most important element of the Eurogroup agreement being that 25 billion euros would be earmarked for the recapitalisation needs of the Greek Banking system. Nevertheless, the amount of funds needed to secure the capital adequacy of the Greek banks, and most importantly, the legal framework that would apply in relation to such recapitalisation and including whether some incentives for private shareholders will be provided or not, have not been officially disclosed until present. This has generated an apparent uncertainty to the investment community, since very important information on listed credit institutions seriously affecting the valuation of their securities, has not been made known yet, adding to both macroeconomic and market uncertainty.
14. Within this context the HCMC deems that not imposing a ban on short sales on bank shares would tend to strengthen price volatility on listed credit institutions that will perpetuate market uncertainty. HCMC also deems that adverse circumstances persist in the Greek capital market, as regards mainly to the recapitalisation of the systemic credit institutions that is expected to take place in the next two to three months and the relevant impact on the banking sector outlook, resulting mainly in persistent market uncertainty that poses threats to the financial stability and the general level of market confidence.
15. In the notification, the HCMC also explains that the proposed limited temporary ban of short-selling concerning shares of credit institutions admitted to trading on the Athens Exchange is not expected to significantly impair price discovery and therefore market efficiency.
16. The imposition of capital controls and the restrictions of transfers in the acquisition of financial instruments (i.e. restrictions on the buy side) for Greek investors based on Article 5 of Law. 3606/2007 (A 195) through regulated markets and multilateral trading facilities or professionals who have such financial instruments as UCITS is still in force at the time of the proposal of the present measure.
III. Opinion
17. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of the Regulation:
On the adverse events or developments
ESMA considers that adverse developments which constitute a serious threat to market confidence in Greece still persist. Despite the partial reopening of credit institutions on 20 July 2015, and the reopening on 3 August 2015 of the ATHEX regulated market, the Multilateral Trading Facility of “EN.A”, and of the Electronic Secondary Market “HDAT” for government bonds, fragility in the financial system and in the Greek economy still persists due to the situation of the banking sector in Greece. The successful conclusion of the Greek banks’ recapitalisation and the relevant restructuring process is important in order to safeguard the stability of the financial system and of the Greek capital market.
On the appropriateness and proportionality of the proposed measure
ESMA considers that the proposed measure means in practice a partial lifting of the previous ban on short selling, in terms of the instruments covered. ESMA considers that the proposed measure is appropriate and proportionate to address the above mentioned threats that persist in the Greek financial markets. Short sales in the shares of the five Greek credit institutions admitted to trading on the Athens Exchange and comprising the FTSE/Athex Banks Index could still exacerbate the threats to financial stability, especially considering the upcoming recapitalisation of the Greek Banking system. Market volatility might render the recapitalization more difficult and more costly. At the same time, the proposed measure, relating only to Greek credit institutions, is clearly meant to accompany the gradual normalisation of financial conditions in Greece. The exemption foreseen for market making activities is justified by the fact that market makers should be allowed to properly carry out their activity, thus enhancing the liquidity on the above mentioned shares and contributing to the adequate functioning of Greek financial markets.
On the duration of the proposed measure
ESMA considers that the duration of the proposed measure is justified, taking into account the uncertainty surrounding the ongoing recapitalization and restructuring process of the systemic credit institutions in Greece. Under these circumstances, ESMA considers it is necessary and appropriate for HCMC to impose a short selling ban on the mentioned Greek credit institutions admitted to trading on the Athens Exchange and comprising the FTSE/Athex Banks Index that would last until the 9th of November 2015, with a view to reducing price volatility in the course of this process. Besides, ESMA takes into consideration HCMC’s statement in its notification of intent that the proposed measure may be lifted before the end of the established period should the circumstances allow for it, though not excluding a renewal of the proposed measure in accordance with the provisions of the Regulation, should the recapitalisation and restructuring process not be concluded by its expiry date.